Monday, 11 May 2009

That was the year that was

I have little interest in reliving last season. Frankly it was more than horrible enough to have to go through it once, never mind having to do it all over again.

However, it would be remiss of me not to at least share my thoughts about the overall effect of the season that we have had.

We have gone (all be it that many fans didn't actually believe it) from being a team that was offering a free season ticket in the event of promotion - something that the club promised we were pulling all the stops out to achieve - to a team that has been relegated to the third division with the promise that if we sell enough season tickets we will be able to keep some, if not all, of our current squad for a promotion challenge. The fact that we would probably need to sell just under 37,000 season tickets to raise the income we spend is actually a moot point, and gives an indication that the club are using PR to 'convince us' that next season is one that we want to be a part of.

I have never been one of those that expects the board to invest, or raise, money to fund my hobby. I have also come to accept that my season ticket income is almost irrelevant to the club. Last season's ticket at £475, all be it money they would rather have, was not going to make a big dent if the annual loss if £11m plus.

It is unrealistic to expect the board to keep the players that we have on high wages. It is also unrealistic to expect the board to turn down any sensible offer for a player we have. This applies irrespective as to the level of wages he is on. Let's face it, the board are unwilling (or unable) to fund the club at a cost (loss) of c. £10m a year. Without stating the obvious, it would cost £50m to do that for five years, and there is not much evidence that we will be back in the Premier League during that time.

So where does that leave us?

Well, we need to raise some money and/or cut our costs.

Raising Money

This can come from various sources. The one that most fans hope for, and the one the club are 'advertising' is new investment from outside of the current board. This is the fan's favourite as it will probably provide a large sum of money that will enable us to keep our players and go on a spending spree. This is, in my view, the least likely. Needless to say those selling (or trying to sell) season tickets want us all to believe that this might happen. After the collapse we have seen in the playing side of our football club since January 2008, there is little (relatively) interest in buying a ticket that commits us to another 46 games of football.

I would love us to suddenly announce that we have the money for a new manager, new players, and a real push for promotion. This is no reflection on the current board who have, I believe, given us some fantastic memories in the last eleven seasons. Had I been offered those seasons followed by ten years in the wilderness in August 1997 I'd have ripped their arm off. Frankly, however, there is little evidence that the current board have either the finances or the 'ability' to bring those days back. A little like Clive Mendonca was our hero in 1998, and went on to score some great and special goals, but I wouldn't want him leading the line in our team next season. Actually I might, but you understand the point.

Maybe it is time for the current board to bow out. Not be chased out, but to move on to something new, while the club does the same. However, I have little confidence that a take over or substantial investment is coming. It is clearly in the best interests for the club to continue to have us believe there is, as it will boost season ticket sales. I believe that all the press releases by Phil Parkinson telling us he does not know what his own position is, or which players will be here next season are also part of this PR exercise. I hope that I'm wrong, and if so I will be the first to apologise for my lack of faith, but after the last two summers I have little reason to believe that we will not see a fire sale once the club believe that we have sold as many season tickets as we are going to.

This leaves us with other ways of raising money. We sell assets. The training ground and a couple of houses have been sold. This has raised money that Richard Murray has described as being needed for working capital, and has been invested already. I think we should assume that some (probably a lot) of this money has been spent already. Without doubt it is not going to be enough to cover our costs for the season to come.

From my limited understanding of the accounts that leaves us two other asset types. The Valley and the players registrations. I think we all agree that selling The Valley on a permanent basis is a mistake and should be seen as a last resort. By permanent basis I mean selling for development. I'm talking about leaving The Valley and playing somewhere else. I think this subject needs no further discussion. However, one option would be to sell The Valley and agree a long term lease contract. Richard Murray has mentioned that this would be an idea situation (he was talking about selling to the local council). As good a deal as this would be for the club it would be as bad for the new owners. It would mean that they would own a football stadium that could only realistically be used by one customer, and that customer, being a football club, is likely to suffer financial difficulties at a moments notice. Without planning permission for development (not likely to be granted) purchasing The Valley could be a bad investment. Thus I cannot see anyone wanting to stump up millions of pounds on that basis.

This leaves us just the players registrations as saleable assets. We only have a few players that I believe are worth much money. Clearly Jonjo Shelvey is a great player in the making. There is no doubt that he has a value, both now and in the future. Sadly to realise his true value we need to keep him for a few years and develop him. I fear that this will not be allowed to happen.

Other players that we hear talk about leaving are Bailey, Hudson, Racon, Gray, Sam, Dickson, Fleetwood and McLeod. The last three of those may well leave, but as they have done nothing to convince anyone that they have enough ability to play in the Championship or above, they will probably leave for next to nothing. McLeod is possibly the most talented of the trio, but his wages probably make him a little 'out of the price range' of most lower league clubs.

I will deal with the others individually.

Nicky Bailey has had a great season, but has problems with being caught on the ball, and is probably on decent money. Unless he had a pay cut in the event of relegation in his contract he is likely to be one of the better (not best) midfielders in the Championship. I think it unlikely that a Premier League team will be interested, as he gets caught in possession way too often in The Championship to be able to cope with the Premier League. This means that his agent will have to convince a Championship side with promotion aspirations to offer him very good money and offer us very good money for him. I, personally, cannot see both those events happening. Thus he will either stay, or leave for a pay cut, or we will not receive much money for him to get him off the age bill.

Mark Hudson is probably on serious money due to him coming on a free transfer. This makes it unlikely we will be offered much for him. He might be one we want to off load due to his wages, but I think he will stay.

Therry Racon has had a good, not great, season. He did very well at Brighton at the end of last season, and I can see him being involved in a decent Championship side. I am hopeful that having had just one season, and it being a little injury prone, we will be able to keep hold of him. I imagine that his wages are not massive, and I think he will look outstanding in the third division.

Andy Gray cane to The Valley bang in form, an established, experienced, footballer and has been a complete flop. There have been suggestions that the reason he was so, so keep to come to us was that Burnley were paying him £3k a week and we offered him £12k a week. How that happened when we paid a very high transfer fee for him is beyond me. I'm assuming that these rumours are true, of course. If they are not then my logic will be unsound. However, if there is much truth in the numbers I would imagine that we would do just about anything to offload him. He has had a series of 'personal' problems, some of which have still not been shared with the fans, and I, for one, am tired of excuses. If we receive any realistic offer for him I think we should let him go. Some players work out and some don't. On the basis that I have no evidence that his 'personal' problems were anything other then bad luck I am happy to thank him for his efforts, but let him leave and take his 'personal' problems to another club's payroll.

Lloyd Sam is a player with no little ability. He seems to be lacking in confidence from time to time, but in the last few games he seems to have played like the winger we all thought he could be. I doubt that he is worth a huge transfer fee, but if we are going to struggle to sell many of our 'high value' players than a few hundred grand might be a decent return for a player that we can probably manage without.

Over all there is not a lot of value in our players in my view. I think we would struggle to raise more than £3m if we do not sell Shelvey. For this reason I expect the young star to go.

Having said that, I actually expect the reported take over to come to nothing, and all our players to be sold for knock down prices in another fire sale when the board realise that we are going to sell nowhere near the 10,000 season tickets that would be required to pay for just the running costs of The Valley.

I don't enjoy being pessimistic, but I just feel it's time for a bit of realism. Selling assets is not the only way to make the books balance.

Cost Cutting

Charlton had several seasons in the Premier League where we were not actually expected to be relegated. This caused an expansion of our cost base. Some of the 'investments' have been great. Darren Bent was a great investment for example, but on an other side of the business we have redeveloped the stadium, upgraded the training facilities, installed a huge screen and built up the admin staff to levels previously unknown.

The first area to look at in the cost cutting should (and has) been those areas that are not directly associated with the first team. A quick look at the Program will tell you we have a Group Chief Executive, a Deputy Group Chief Executive, a Managing Director, an Operations Director, a Commercial Director, a Commercial Centre Manager, four Club Development employees, a Communications Manager, a Conference and Banqueting Operations Manager, a Retail Manager and a couple of others. I'm not suggesting that any of that list are not worth their money, nor am I suggesting that just because we have three 'Directors' and two 'Chief Executives' they are earning hundreds of thousands of pounds a year between, but I would imagine that there were considerable savings available if we were to need them - and we clearly do.

I have no idea how many employees a Premier League club needs in comparison to how many a third division club needs, but I'm guessing we all know what the comparison is between what that the two clubs can afford. Thus it was always going to be the more administrative jobs that were going to be under threat. I have little interest in showing no compassion to those that have lost their jobs, particularly in these economic conditions, but I can't hep feeling that the writing has been on the wall for a while.

I have always worked in environments where your performance has been very easy to judge. It has always been easy to calculate how much an employee costs and what they contribute. Under these conditions it is easy to identify which employees should stay and which should go. However, since the credit crunch there have been a number of people that I know who have found that, despite their best efforts, they have become too expensive for their employers.

As I say, I have a lot of sympathy for those that have lost their jobs, but realistically they were always going to be surplus to requirements in the third division, and I would imagine that many of these posts will not be refilled if/when we return to the Championship.

As well as these, let's face it, small savings, we are going to have to reduce the playing squad. I won't list them, but there are a number of players on Premier League money that will not be plying their trade in that division again any time soon, probably never. A number of those players are on contracts that finish this summer. I suspect that they will turn up at another club, but their lifestyles are going to change more than that of those Bankers that marched our banks into public ownership.

I would, personally, rather see the back of those players that have been earning hundreds of thousands of pounds a year while contributing little or nothing. I'll not name names, but I'm sure you know who I'm talking about?

So we will start next season with a much smaller squad. This is ok, Aston Villa have played about half the number of players we have this season, and they have had a great season. They are on target to win the Premier League, excluding the four teams that don't count as they are given a 'bye' into the top four by default.

I heard Richard Murray talk about Leicester only keeping their team together last summer as no one made bids for their players. I'm not sure if this was to prepare us for the mass exodus, or simply to stop the growing support for us to try to keep the side together to guarantee promotion. When you bear in mind that our current squad can only really be financed in the Premier League, it is just insane to expect us to keep it in the third division.

Thus I predict that by the tenth of June we will have instructed Agents to source buyers for all our players, and by the end of June we will be desperate to sell anything that moves as we will by then realise that Nicky Bailey isn't worth £2m and Jonjo Shelvey isn't worth £5m.

Strangely the worst thing that can happen from a financial point of view is probably the best thing that can happen for the short term fortunes of the football team. If we receive no offers at all, we will clearly keep the majority of the squad intact.

My belief is that we will lose Shelvey and Gray, but keep the rest. January could well be a good time to realise money for those that stay. It will, I guess, depend on how we are doing, and how the individual players have performed. I doubt, however, that any of them can do anything in the third division to boost their reputations much.

Thus, if I'm correct, we are likely to have a good season on the pitch, but will be in real danger of financial meltdown. If we cannot sell enough players or season tickets administration must be a real possibility.

Having said all that the board could, this year, be telling us the truth, and by the end of May we could have new owners with a war chest to attack the transfer market. Stranger things have happened. If you'd told me on 24 May 1998 that "Tomorrow we are going to score four goals, seven penalties and the last hat-trick at Wembley for over a decade" I would have slapped you and called for a Doctor.

Up the Addicks!


Anonymous said...

Bit harsh on Gray who's wife I beleive has a brain tumour - enough to distract everyone from a game of football I think. Otherwise a fair representation of our situation

CoachingByPeter said...

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Ken Jennings said...

Interesting observations regarding the 'PR' excercises (or the 'BS', if one is remotely cynical), designed to promote ST sales.
It seems to my old addled brain that the feeling of being 'conned' started when the new order of Waggot/Chappell took over the reins from the previously tried and trusted Murray/Varney helmsmen. They did not make false promises, they did not treat us supporters like gullible 'Marks'.

Murray and Varney generally kept quiet counsel until there was something you could hang your hat on - whether you agreed with it or not - and a great amount of trust was deservedly built up as a result.

I think this latest duo have made a big mistake, however well meaning for the sake of the club, by cashing in on that trust by making promises they either could not keep or worse still, had no intention of keeping.

I think they got their 'read' of us supporters totally wrong - and I think it will come back to bite them in the arse when it comes to ST sales this time round.

Terry Thomas said...

I always felt that the promise of a free season ticket in previous years, was laughable, bearing in mind that while the promise was being made, Pardew was in the process of assembling a squad that was quite plainly not going to be anywhere good enough to get promoted. The club also insulted the fans by selling major players after the season ticket cut off date after having made vague promises that this wouldn't happen. This season the fans are not going to be fooled - I hope. I am almost certainly not going to renew anyway, as the price of £425 for an East Stand seat in current circumstance (financial and football) is too much. But even if I could be persuaded to renew, previous close seasons have taught me to wait to see what the club does first. Floating ideas such as potential takeovers in front of the fans will not work. We nned to know who will be here, who will be managing the club, and who will be owning the club, before we are fooled again.

Kings Hill Addick said...


I am aware of the brain tumour issue with Andy Gray's wife. I do feel genuine sympathy for him, and I wish her a full and speedy recovery.

My main issue with him, however, was the fact that the personal problems led to him first being substituted about a month after he joined us (1st March). The actual reasons for the 'personal problems' (all be it that I accept that it was personal) were never disclosed.

As I said, I am happy to wish him well, but he was bought for a lot of money and paid a lot of money as he was supposed to spearhead our charge back to the Premier League in the spring of 2008. He scored 2 goals in the run-in, one of which was in the last game of the season when we were already unable to make the play-offs.

The rumours circulating are of alcohol, drugs and gambling. The fact that we were never told about what happened in February 2008, yet were told what happened in October 2008, do suggest that it might have been thought that the fans would offer little sympathy if his problems were disclosed.

I don't have any interest in criticising the man - his problems are not my business. I just don't want to pay him another £600k plus next season.

Anonymous said...

The implication that the Board have deliberately misled supporters in order to maximise season ticket sales is absurd. The free season ticket "option" was a clever gimmick to help sell season tickets; a gimmick which represented a low probability (the chances of promotion) of a high value outcome (a free season ticket) and that should have been obvious to anyone giving the scheme a moments thought. Do you really think that the Board then said "Good news. The pressure is off. No need to worry about trying to win promotion"?!!!

Anonymous said...

Thought provoking as usual KHA. I fear you are right - its unlikely that we will raise large sums from selling our best assets. Being part of such a failed side is hardly an advert. To us they look good - but our view is relative...

Gray was talking about a move in winter transfer window - unless she was misquoted. Interesting that he was prepared for all that upheaval in the midst of such a personal crisis. Of course he might have been desperate to get away from the current management.

What are our options for high paid players we can't sell on? Presumably we can't just terminate their contract because they have been cack? (For most ordinary people you can of course sack them for not performing, with enough warnings)

So if we can't sell them on, I suppose its pay them the equivalent of their remaining contract wages and rid immediately or keep them in the reserves and pay them monthly until the contract ends.

Pembury Addick

assuming soem of your assumptions are correct

New York Addick said...

Good stuff KHA - I wish I could find the energy to write something of similar depth.

It'd be a shame to lose Lloyd Sam in my view - with decent coaching I think he could be outstanding at Championship level, let alone League One.

He clearly needs to add goals to his game too however - 2 goals in 55 starts isn't good enough for such an attacking player (interesting that Jamal Campbell-Ryce, virtually the same age and same position, scored nine last season).